Question 1

Free riding is possible if the good is nonexcludable.

Accepted Answer

A) True 
 B)False

Question 2

The economy's marginal benefit curve for a public good is found by ________ for all individuals.

Accepted Answer

A)  vertically summing the marginal benefit curves 
B)  vertically summing the total benefit curves 
C)  horizontally summing the total benefit curves 
D)  horizontally summing the marginal benefit curves 
A)  vertically summing the marginal benefit curves 
B)  vertically summing the total benefit curves 
C)  horizontally summing the total benefit curves 
D)  horizontally summing the marginal benefit curves

Question 3

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. If the marginal social cost of a satellite is $54, the efficient quantity of satellites is

Accepted Answer

A)  0. 
B)  1. 
C)  2. 
D)  3. 
A)  0. 
B)  1. 
C)  2. 
D)  3.

Question 4

For a public good, the marginal social benefit curve is the ________ summation of all the individual marginal benefit curves. For a private good, the marginal social benefit curve is the ________ summation of all the individual marginal benefit curves.

Accepted Answer

A)  horizontal; vertical 
B)  vertical; horizontal 
C)  vertical; vertical 
D)  horizontal; horizontal 
A)  horizontal; vertical 
B)  vertical; horizontal 
C)  vertical; vertical 
D)  horizontal; horizontal

Question 5

Because of voter rational ignorance, the government might not produce the efficient quantity of a public good.

Accepted Answer

A) True 
 B)False

Question 6

-Mike, Joe, and Sam are roommates. They need lamps for their common living room. Lamps in their living room are a public good for these roommates. The marginal benefit that each individual receives from varying numbers of lamps in the living room is given in the table above. If the marginal cost of a lamp is 13, what is the efficient number of lamps for the roommates to purchase?

Accepted Answer

A)  2 
B)  5 
C)  0 
D)  1 
A)  2 
B)  5 
C)  0 
D)  1

Question 7

Education at a private university is NOT a pure public good because it is

Accepted Answer

A)  nonrival. 
B)  excludable. 
C)  both nonrival and nonexcludable. 
D)  None of the above answers is correct. 
A)  nonrival. 
B)  excludable. 
C)  both nonrival and nonexcludable. 
D)  None of the above answers is correct.

Question 8

Michigan Radio is the state's most listened-to public radio service, attracting approximately 400,000 listeners each week and is funded through listener donations. Listeners can access Sirius satellite radio through a subscription to the service. Michigan Radio is a ________ and Sirius satellite radio is a ________.

Accepted Answer

A)  common resource; natural monopoly 
B)  public good; natural monopoly 
C)  natural monopoly; private good 
D)  public good; common resource 
A)  common resource; natural monopoly 
B)  public good; natural monopoly 
C)  natural monopoly; private good 
D)  public good; common resource

Question 9

Why will a private market be unable to produce the efficient quantity of public goods?

Accepted Answer

A)  because the good's marginal cost is too low 
B)  because the good is nonexcludable, so there is the free rider problem 
C)  because the good is rival, so no one will want to pay the producer for it 
D)  All of the above answers are correct. 
A)  because the good's marginal cost is too low 
B)  because the good is nonexcludable, so there is the free rider problem 
C)  because the good is rival, so no one will want to pay the producer for it 
D)  All of the above answers are correct.

Question 10

Cable television is an example of a public good.

Accepted Answer

A) True 
 B)False

Question 11

Goods that are nonrival and nonexcludable are called

Accepted Answer

A)  external goods. 
B)  public goods. 
C)  private goods. 
D)  free goods. 
A)  external goods. 
B)  public goods. 
C)  private goods. 
D)  free goods.

Question 12

What is rational ignorance?

Accepted Answer

Rational ignorance is the voter's decisi

Question 13

If people can benefit from a good even if they do not pay for it, the good is nonrival.

Accepted Answer

A) True 
 B)False

Question 14

A free rider is someone who

Accepted Answer

A)  pays for a good and then does not consume the good. 
B)  consumes a good without paying for it. 
C)  pays the dollar value that he or she places on a given amount of a public good. 
D)  pays the maximum amount that he or she is willing to pay for the good. 
A)  pays for a good and then does not consume the good. 
B)  consumes a good without paying for it. 
C)  pays the dollar value that he or she places on a given amount of a public good. 
D)  pays the maximum amount that he or she is willing to pay for the good.

Question 15

-The principle of minimum differentiation reflects the

Accepted Answer

A)  tendency for firms to produce at minimum marginal cost in order to compete with one another. 
B)  tendency for political parties to make themselves identical to appeal to the median voter. 
C)  concept of minimizing the difference between total benefit and total cost to produce efficiently. 
D)  attempt to minimize the free-rider problem. 
A)  tendency for firms to produce at minimum marginal cost in order to compete with one another. 
B)  tendency for political parties to make themselves identical to appeal to the median voter. 
C)  concept of minimizing the difference between total benefit and total cost to produce efficiently. 
D)  attempt to minimize the free-rider problem.

Question 16

Rock climbing areas are often on public lands. These areas, which are often crowded, are classified as

Accepted Answer

A)  rival and excludable. 
B)  non-rival and excludable. 
C)  rival and non-excludable. 
D)  non-rival and non-excludable. 
A)  rival and excludable. 
B)  non-rival and excludable. 
C)  rival and non-excludable. 
D)  non-rival and non-excludable.

Question 17

-In the above figure, the competitive unregulated equilibrium is producing and consuming ________ vaccinations per year at a price of ________.

Accepted Answer

A)  30 thousand; $40 
B)  30 thousand; $30 
C)  30 thousand; $20 
D)  50 thousand; $30 
A)  30 thousand; $40 
B)  30 thousand; $30 
C)  30 thousand; $20 
D)  50 thousand; $30

Question 18

-Mike, Joe, and Sam are roommates. They need lamps for their common living room. Lamps in their living room are a public good for these roommates. The marginal benefit that each individual receives from varying numbers of lamps in the living room is given in the table above. If the marginal cost of a lamp is 9, what is the efficient number of lamps for the roommates to purchase?

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4 
A)  1 
B)  2 
C)  3 
D)  4

Question 19

Explain why some amount of ignorance can be rational.

Accepted Answer

Acquiring information is not costless. T

Question 20

Which of the following is the BEST example a public good?

Accepted Answer

A)  a parking space 
B)  a car 
C)  a stop sign 
D)  a toll road 
A)  a parking space 
B)  a car 
C)  a stop sign 
D)  a toll road

Free riding is possible if the good is nonexcludable.

The economy's marginal benefit curve for a public good is found by ________ for all individuals.

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. If the marginal social cost of a satellite is $54, the efficient quantity of satellites is

For a public good, the marginal social benefit curve is the summation of all the individual marginal benefit curves. For a private good, the marginal social benefit curve is the summation of all the individual marginal benefit curves.

Because of voter rational ignorance, the government might not produce the efficient quantity of a public good.

Education at a private university is NOT a pure public good because it is

Michigan Radio is the state's most listened-to public radio service, attracting approximately 400,000 listeners each week and is funded through listener donations. Listeners can access Sirius satellite radio through a subscription to the service. Michigan Radio is a and Sirius satellite radio is a .

Why will a private market be unable to produce the efficient quantity of public goods?

Cable television is an example of a public good.

Goods that are nonrival and nonexcludable are called

What is rational ignorance?

If people can benefit from a good even if they do not pay for it, the good is nonrival.

A free rider is someone who

-The principle of minimum differentiation reflects the

Rock climbing areas are often on public lands. These areas, which are often crowded, are classified as

-In the above figure, the competitive unregulated equilibrium is producing and consuming vaccinations per year at a price of .

Explain why some amount of ignorance can be rational.

Which of the following is the BEST example a public good?

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 16: Public Choices, Public Goods, and Healthcare

Free riding is possible if the good is nonexcludable.

The economy's marginal benefit curve for a public good is found by ________ for all individuals.

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. If the marginal social cost of a satellite is $54, the efficient quantity of satellites is

For a public good, the marginal social benefit curve is the ________ summation of all the individual marginal benefit curves. For a private good, the marginal social benefit curve is the ________ summation of all the individual marginal benefit curves.

Because of voter rational ignorance, the government might not produce the efficient quantity of a public good.

Education at a private university is NOT a pure public good because it is

Why will a private market be unable to produce the efficient quantity of public goods?

Cable television is an example of a public good.

Goods that are nonrival and nonexcludable are called

What is rational ignorance?

If people can benefit from a good even if they do not pay for it, the good is nonrival.

A free rider is someone who

-The principle of minimum differentiation reflects the

Rock climbing areas are often on public lands. These areas, which are often crowded, are classified as

-In the above figure, the competitive unregulated equilibrium is producing and consuming ________ vaccinations per year at a price of ________.

Explain why some amount of ignorance can be rational.

Which of the following is the BEST example a public good?

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

For a public good, the marginal social benefit curve is the summation of all the individual marginal benefit curves. For a private good, the marginal social benefit curve is the summation of all the individual marginal benefit curves.

-In the above figure, the competitive unregulated equilibrium is producing and consuming vaccinations per year at a price of .